Current Reality

Now that we know the broad outlines of the 2008 election cycle, all of us should take a deep breath before predicting either gloom and doom or happy days again for the Republic. We need to apply what has been called a primary rule of corporate management but also is an axiom relevant to broad swathes of life: The first task we face is to determine current reality.

The assessment of current reality means we must understand what is, not what we want or fear. Only after we correctly determine current reality can we move forward to implement what we desire to happen and to prevent what we fear might happen.

Assigning blame for the state of current reality doesn't really help except as a lesson in history so that we don't make keeping making the same mistakes. To paraphrase Albert Einstein: Insanity consists of doing the same thing over and over, and expecting the outcome to be different.

What are some features of current reality that the Republic faces? Let's look at few aspects of our financial situation: A national dept of $10 trillion dollars (that's 10 followed by 12 zeros); a budget deficit that probably will reach $1 trillion dollars in 2008/2009; wars in Iraq and Afghanistan that consume tremendous amount treasure, both financially and human; and a world-wide economic slowdown, i.e., a recession that could become an outright depression.

The current reality of this dire financial situation militates against a major "spend and tax" program that some Democrats want and most Republicans fear. Where are we going to get the money, keeping in mind that we pay a tremendous amount of interest on the national debt, in large part to countries aims and policies inimical to our Republic?

Another aspect of our financial situation relates to reducing/paying off the national debt. We cannot continue to spend/borrow on the present basis without destroying the Republic. Simply put, we have to pay back, with interest, what we've borrowed. Like personal credit card balances with exorbitant interest for unpaid balances, the good times must come to an end.

How will we reduce/pay off the national debt? I double-dog dare anyone to produce realistic figures that show how we can stimulate the economy (yes, by borrowing more money) to such an extent that we can grow the economy sufficienly to reduce/pay off the national debt at the present level of spending and tax rates. Those of us raised in the South thoroughly understand the challenge of a double-dog dare.

A perhaps unsavory aspect of financial current reality, therefore, projects that we must judiciously raise taxes to the fairest extent possible on all segments of the population while restraining spending. Like a family trying to work itself out of a large credit card balance, we must spend only on essentials. No, we don't have to pay off everything in one year.

So, who do we want to make the payments? Hey, we're responsible; consequently, we should pay up rather than continuing our profligate individual and national lifestyles. Do we want our children and grandchildren to pay for our financial idiocy? If so, the Republic should fall.

Please don't respond by telling me the either the Democrats or the Republicans go us into this situation. We elected them and, by acquiescence, went along with their terrible budgetary mistakes.

Our financial situation suggests to me that the forthcoming Obama administration simply will not have the resources to implement, in the foreseeable future, a "spend and tax" policy so feared by many conservatives.

A next to last thought for this blog, taking into account a rational interpretation of history: A "trickle-down" economic policy derived by reducing taxes on high income individuals has a snowball's chance in hell of reversing our current financial morass.

Finally, the time has come for all of us to pay up: The only question is how to spread the pain equitably across the population.

Keep the faith.